Following California implementing a law raising its minimum wage to $20 for more than 500,000 fast-food workers in the state in 2024, Christopher Thornberg, founding partner of research firm Beacon Economics, offered a warning about the state raising its minimum wage.
“California’s well-intended push to reduce income inequality via wage floors is beginning to have a significant negative impact on some of our most vulnerable workers—our youth, particularly those from lower-income households,” he wrote earlier this year.
His concerns echoed those of fast-food franchise owners, one of whom told Fortune in 2024 that higher wages would be unsustainable for smaller chains with slim margins.
But nearly two years after the law’s passage, economists are seeing very different results than what was initially feared. A working paper from University of California at Berkeley released this month found the policy increased average weekly wages for eligible workers by 11% and did not reduce employment. Prices increased modestly, about 1.5%, or the equivalent of about six cents for a $4 item.
It depends. Cost of living and other factors.
https://livingwage.mit.edu/
Note that the minimum wage level is called the poverty wage here.
I think any sort of basic income effort would have to have a base federal level to meet all areas, and then state and county additional amounts to account for the cost of living differences.
Ohh, nice, thank you for this. Though I am not sure I like the cost of living being lower because of geography. I feel incomes should be across the board with minimal difference. I’m still doing the same level of work as someone in a smaller town. They shouldn’t make less because of such factors.
If the goal is to level the playing field (upwards), then maybe that would be more fair. Turn it around, why should you be making less than them because of location? You said you felt like you were just getting by, right? Maybe your wage is the correct wage for a rural town.
If a person moves to a new location/job, the wage would adjust for that area.
As things currently are yeah, wages do need to change depending on CoL in specific areas.
Reality I feel wages should be flat for that position. If I’m in Nebraska I should still make let’s say $60K which is what someone in a city would make for a similar position. Just feels the current system brings more reward to live in a large city and results in essentially states with veritable ghost towns because they’re more rural.